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Court clash set on Exxon Valdez case reopener At stake is $92 million government demand over lingering oil from 1989 spill; activist says this could be ‘bitter end’ of epic case Wesley Loy For Petroleum News
Government and ExxonMobil lawyers are set to meet in a federal courtroom on Nov. 15 to argue the latest chapter of a case spanning more than two decades.
At stake is $92 million the federal and state governments have demanded of the oil giant in connection with the Exxon Valdez oil spill in Prince William Sound.
The governments have said the money could be used to remove lingering oil from Alaska beaches.
ExxonMobil, however, is seeking to disqualify the government demand.
U.S. District Judge H. Russel Holland, who has long presided over court action stemming from the 1989 oil spill, has scheduled a hearing for 1:30 p.m. Nov. 15 in his Anchorage courtroom on ExxonMobil’s motion opposing the government demand. The judge has given each side 15 minutes to talk.
Unanticipated injury The governments made the $92 million demand pursuant to a “reopener” clause in a $900 million civil settlement reached with Exxon in 1991.
The clause allowed the governments to request up to $100 million more from the company to deal with unanticipated injury to habitat or species.
The governments said they made the $92 million demand after new information emerged that relatively unweathered oil remained in the subsurface of beaches in Prince William Sound and the Gulf of Alaska, and that the toxic oil was degrading at a far slower rate than was anticipated at the time of the 1991 settlement.
Although the governments requested the money years ago, in 2006, ExxonMobil hasn’t paid and the governments haven’t sued to collect. The governments say they won’t sue until certain studies are complete. One study focuses on the feasibility of bioremediation to rid the beaches of oil.
ExxonMobil’s attorneys argue the governments failed to propose a proper restoration plan, and therefore the $92 million demand is invalid.
‘Running for cover’ The upcoming hearing appears to be a product of the efforts of Rick Steiner, a well-known oil industry critic and former University of Alaska professor.
Last December, Steiner began a court campaign seeking to force ExxonMobil to pay. Steiner contends the governments have been remiss in not pursing the money more aggressively.
He believes the Nov. 15 hearing could be pivotal.
“Should be interesting,” Steiner told Petroleum News in an Oct. 21 email. “This could be the bitter end of 22 years of litigation over Exxon Valdez.”
Recently, Steiner again asked the judge to order ExxonMobil to pay the $92 million plus interest. But Holland on Oct. 20 denied Steiner’s motion.
Holland also reiterated something he has said previously — that it’s up to the governments, not the court, to press a reopener claim.
“The court was previously and is now concerned that it might prejudice the parties by injecting itself into their business,” Holland wrote in his Oct. 20 order.
Steiner is unhappy with the situation.
“Exxon does not want to pay a dime, the governments say they want to ‘study it some more,’ knowing they have no case, and the Court, that approved the provision 20 years ago, says now it has no hand here,” Steiner said in an Oct. 24 email to Petroleum News. “Everyone is running for cover on this — the court, the State of Alaska, the U.S., and Exxon — a real insult to the public interest.”
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